Domestic Innovations

1. Proxy Payment (Accounts)

Proxy payments enable users to immediately transfer and receive funds without revealing the recipient’s bank account information. Proxies securely map recipient aliases (e.g. mobile phone number or email address) to bank account.

Example: Thailand’s real-time payments (RTPs) service, Promptpay, enables users to reveice and transfer funds using proxies. After registering their bank account with PromptPay, consumers can securely send and receive P2P payments, send P2B payments to merchant sand even receive G2P payments

Payment flow:

• Users log into any mobile app with Promptpay support
• For P2P payment, users key in the Thai citizen ID or phone number as a proxy
• For P2B payment, users key in the merchant Tax ID
• Users specify the payment amount and verify the transaction details before confirming funds

2. QR payments (Accounts & Closed-loop)

QR payment is a contactless payment method where customers make payments by scanning QR codes from mobile banking apps

Example: Argentina banks co-launched the payment app MODO, allowing consumers to pay for goods and services by scanning QR codes. MODO also supports sending and receiving P2P funds

3. Direct Payments (Cards & Accounts)

Direct Payments from Bank app are omnichannel digital solutions for retail payhments, allowing consumers to pay in-store or online directly through a mobile banking app.

Example: HSBC integrated Pay by Bank into their mobile app. The omnichannel payments solution enables customers to pay directly via their preferred rails from any eligible account with available funds (e.g. cards or savings).

Payment flow:

• Customers click Pay bu Account at checkout
• Customers then select their payment method from their choices of bank account and cards
• Logging into their banking app, customers select the account to pay with, and confirm the transaction, finalizing the payhment on the merchant site

4. Bill payment (Cards & Accounts)

Bill payment offers digital bill presentment and messaging solutions for consumers to view, manage, and pay bills without setting up accounts with different billers.

Example: Request to Pay is a secure messaging service overlaying the UK’s existing payment infrastructure. It enables consumres to manage and pay their bills via one mobile app. It offers multiple payment options or customers to make payments via card, RTP, or bank account

Payment flow:

• Billers can send regular bills and one-off requests with payment information to payers on Request to pay
• Payers view list of historical request on their mobile app, choose from various option to pay each billers,
• Payers choose the respective bill request, and confirm the payments and see their bill status update

5. e-COD (Accounts)

E-COD is any platform enabling business to collect payments from buyers in real-time at the point of delivery.  Platforms integrate functions such as invoice and receipt presentment and payment notifications.

Example: UOB mCollect is an integrated digital collections solution. It enables businesses to collect payments from buyers via PaynNow upon delivery. Fund availability is immediate.

Payment flow:

• Upon delivery of goods, sellers present the digital invoice to customer
• Customer selects PayNow
• From their banking app, customers scan the QR code provided by the seller
• Then, payment arrives immediately to the seller’s UOB account with notification

Benefits including:

• Offers trust  and security to consumers as payment is withheld until product receipt.
• Provides greater transparency and certainty as payment occurs at the point of delivery
• Eliminated customers needing to prepare checks in advance and businesses being unable to confirm or access funds due to processing requirements immediately

Cross-Border Innovations

1. Direct settlement relationshipw with foreign banks (Accounts)

Banks can collaborate with foreign bank counterparts to settle cross-border payments without depending on corresponding banks and third-party payment providers. (©MasterCard Academy on Web)

Roles and value chain: Consumer / Payment Originator / Payment Clearing and Settlement Network / PSP or FI / Business or Consumer

Emirates NBD launched the DirectRemit service by forming direct settlement relationships with core banks in countries with high outgoing international remittance volumes like UK, India, Phillipines, Pakistan, Sri Lanka, Egypt. Payment recipients register for the service through a unique code-shared by senders.

Emirates NBD charges foreign exchange markup only for DirectRemit transfers. Processing occurs the next day for transactions initiated outside business hours. During business hours, a few recipient banks can process near real-time

Payment flow:

• Customers select the account for payment
• Customers enter the recipient’s mobile number, payment purpose, and amount. If recipient has not yet registered their mobile number with DirectRemit, senders share a unique code for recipient to register at an eligible bank
• Customers view transaction details and initiate transactions

2. Interoperable domestic networks (Accounts & Closed-loop)

PAN-region governmental initiatives connect the payment systems of different countries and enable faster and affordable cross-border payments.

Roles and value chain:

• Payer / Payment Originator / Payment Clearing and Settlement Network
• Payment Clearing and Settlement Network / PSP FI / Payee

Examples: ASEAN in Southeast Asia, P27 in the Nordic region, WAEMU in West Africa.

Payment system operators signed MoU to enable real-time cross-border payments by connecting their respective payment infrastructures. Operators include NETS in Singapore, PayNet in Malaysia, ITMX in Thailand, NAPAS in Vietnam, and PT Rintis Sejahtera in Indonesia.

P27 is the world’s firsd digital platform allowing businesses and consumers to make real-time cross-border payments. The platform will serve 27 mln people (hence P27) in the Nordic region, including Denmark, Sweden, Finland, and Norway.

3. Cross-border payments hub (Cards & Accounts & Closed-loops)

Payment Hub Providers enable fast, affordable, transparent, and trackable cross-border payments through settlement relationships.

Roles and value chain:

Payer / Payment Originator / Payment Clearing and Settlement Network / PSP or FI / Payment Clearing and Settlement Network / PSP or FI / Payee

Multinational banks have supported cross-border hubs to provide a single, secure connection between senders and beneficiaries.

Payment flow:

• Sender enters payment instructions into their portal (online banking site, mobile banking app, or bank teller interface)
• Originating institutions perform AML and saction screening checks on senders and recipients, then push payments to mc send cross-border via API
• A multi-rail cross-border hub routes each transaction to the appropriate receiving institution on behalf of the originating institution
• The receiving institurion receives the transaction and posts the funds into the recipient‘s facilities (bank account, card, cash out, or mobile wallet) with no additional fees imposed on the recipient

Other use cases

Maybank as a digital wallet of Maybank2u provides user with multi-rail payment options

DBS integrated their PayNow QR Payments into the DBS collection solutions and added services such as reconciliation and reporting

YesBank offers RTP rail connectivity to e-wallets like PhonePe, allowing them to provide RTP payment services

FAST is an electronic fund transfer transfer in Singapore.

PayNow is a mobile app enabling QR and proxy payment in Singapore.

Faster Payment System (FPS) was launched by Hong Kong Monetary Authority and operated by Honk Kong Interbank Clearing Limited. It provides customers with RTP payments to improve payment efficiency.

UK’s Faster Payment Service (FPS) is the largest real-time payments infrastructure in the world

Sweeden is the first country to outsource its national payments infrastructure thanks to BANKGIROT

Singapore’s FAST (Fast and Secure Transfers) is the first major real-time payments infrastructure implementation based on ISO 20022

Under a regulatory-driven approach, Real-Time Payments (RTP) is digitizing the Thai economy, bringing millions of people into the economic fold.

The US’s The Clearing House (TCH) is the richest ISO 20022 message set.

Bancnet is accelerating the Philippines’ financial inclusion by growing digital payments in the market through InstaPay 2.0

Peru’s regional service (Latin America and the Carribbean Hub) supports Latin America and the Carribbean region